What are the differences between Traditional and Roth IRAs?
The difference between a Traditional and Roth IRA can be summarized by the following comparison.
Contributions | |
Traditional IRA: | Regular contributions may be tax-deductible |
Roth IRA: | No deductions |
Earnings Growth | |
Traditional IRA: | Tax-deferred |
Roth IRA: | Tax-free if used properly |
Distribution Taxation | |
Traditional IRA: | Includable in taxable income |
Roth IRA: | Tax-free for qualified distributions |